Accounting Chamber accusations against ProZorro are groundless – official

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Accusations of the Accounting Chamber of Ukraine that the national budget in 2017 faced a loss of UAH 65 million over the support of the operation of the ProZorro e-procurement system are groundless, First Deputy Economic Development and Trade Minister Maksym Nefyodov has said.

"Only people, who think that they don't need to pay for hosting, Internet, power and other utilities, can say that the money received by SOE [state-owned enterprise] ProZorro is a loss for the national budget. I hope this is the result of the fact that after the reshuffling in the Accounting Chamber they have not had time to understand how different economic sectors work, including public procurement," he said at a press conference at Interfax-Ukraine where a YouControl study on the effectiveness of the ProZorro system was presented.

Nefyodov said that since the very creation, the ProZorro system has struggled to make it self-sustaining.

"Since 2015, we have not received budget financing - their participants should pay for participation in the procurement and not all people or the non-procurement business. We receive from UAH 17 to UAH 1,700 for each tender, depending on the volume of procurement. We are the only state-run structure that since 2015 has not increased, but reduced tariffs, in spite of inflation, the dollar rate and other conditions," the first deputy minister said.

At the same time, he said that the interest received for conducting the bidding procedure is significantly lower than the bank commission, and the money is returned to the business if the tender did not take place or someone did not participate.

Nefyodov said about UAH 65 million is the annual financial plan of ProZorro, of which UAH 21 million of taxes were paid to the national budget in 2017.

"But I don't even know how to comment the statement that one should not pay for power, or hosting, or security costs. We don't plan to reduce tariffs [for operators of authorized electronic platforms]. One cannot earn on tenders. But this is a matter of infrastructural security," the deputy minister said.

Earlier, the Accounting Chamber of Ukraine said that the national budget of Ukraine annually loses UAH 65 million due to the activity of the ProZorro public procurement system, since the administrator's fee collected from the operators of authorized electronic platforms is not sent to the national budget, but goes to the SOE ProZorro.